Go big - or go Bust... ?!?!

**aph** · 09-13-2016, 09:11 PM

Trying to grow. Not scrapping much these days.
Mostly selling for more than scrap. Appliances, etc, you name it.
We get appliances thrown at us daily. WAYYY more than we can handle. Most scrappers in the area are dumb as white bread.
There is so much money to be made, but they all quit. I think the lazy virus is SUPER bad in this area.
Anyway...
Working out of a 5,000 sq ft building and busting out of the seems.
Looking at a 18,000 sq ft building tomorrow. The price is good per sq ft but HUGE in monthly payments.
Might be able to get it for $4,500 a month, maybe even less.
Move in cost is the biggest hurdle.
Here is the kicker....
We turn down stuff all the time, just no space. And we give all our scrap away, just no space and time.
We prob give away at least $300 a week in tin.... All non ferrous still included.
If we take more of the stuff people give us PLUS start recovering the non ferrous we would make $400-500 a week in scrap alone with minimal extra effort. Not even counting the good better than scrap stuff we are loosing out on simply because we can't handle the volume.
If we step up the game we prob could make close to the monthly lease in scrap alone in 3-4 months.
Everything else would be REAL money.
Crazy times.... Just had to vent and well, we will see what the realtor says tomorrow.
The owner would have to invest 50-100K to make it market ready (cold storage, food processing place).
We would take it as is.....
Kinda excited and kinda scared, lol.....
Man what could we do with 18,000 sq ft.....

**RLS0812** · 09-13-2016, 09:45 PM

You have to live in a DENSELY POPULATED area to make real money with used appliances ... in my area, every "used appliances" guy goes out of business within 3 or 4 years.
If you don't believe me, come on over and try it.
Only usable buildings that are 5,000+ are abandoned shops ... ( the owners will not rent them out for cheap )

The issue is not getting the "junk", it's selling it.

**4barrel** · 09-13-2016, 10:44 PM

I am having the same issue here, we have 900 sq ft and are constantly full up. Our problem is that we don't have a door wide enough for a pallet, so we have to box everything and then stack the pallet the day of and have it sitting outside until picked up. Moving to something with a loading dock or at least a garage door in the current market is going to cost 3x what I'm paying now.

I think I could stay in business just barely with the current metals prices, but would have to hire a shop manager since I still work full time as well.

**Mike1286** · 09-14-2016, 12:02 AM

I'm with you but on a much smaller scale. I got a storage unit about 5 months ago due to living in a condo with no garage. I had been scrapping mainly out of the back of my truck. Mostly curbco and family/friend pickups. I formed a business about a year ago, advertised to my local area, and soon became overwhelmed. I used my parents garage for a little while but it filled up fast, was a bit inconvenient to get to for working on stuff, and (I can't blame them) they wanted the pile of stuff out of there. So I moved to a public storage unit. Which has worked great so far, aside from the 340 dollar a month bill. The main reason for forming the business was to advertise, to get more pickups, so I could suppliment my full time income, so I could get a house. But now it's a catch 22. I need the house to have the garage and therefore room for my business so I don't need to waste money on storage, but I need the income from the business in order to afford the house which is currently going to storage rent. But just like any other business decision, I weighed my options and the unit was the best way to go. Sounds like you shared some solid numbers for us to give you our opinions on. But ultimately, at the end of the day, you gotta crunch your numbers and make a decision for yourself. Decide to take the risk or the safe road. Whichever you choose, I wish you luck as you are many steps ahead of me and I only hope to get to that point one day.

**ScrappinRed** · 09-14-2016, 09:48 AM

What about an enclosed trailer for shred? Haul it in when it's full, with a truck bed of non-ferrous.

**cummins** · 09-14-2016, 11:30 AM

Get a 16 ft dump trailer with high walls. Made up. Ive even seen them with partitions / barn doors in side for garbage collection. Ewaste up front shred in the back If your moving that much shred or tin sounds like itll pay for it self weekly. Custom dump trailers new 100 or less weekly. My 2 cents

**StRegis** · 09-15-2016, 10:29 AM

My advice to you is to keep your real estate footprint as small as possible if you are leasing. You are paying someone else a guaranteed rent regardless of what you take in and you are committed for years. I wouldn't even rent a storage unit on a monthly basis. And why are you giving away $300 worth of scrap each month? You can't put that in a pickup truck to your local scrap yard for cash? With that scrap money saved over two years you will have enough for a down payment on an acre of land and you can dump whatever scrap you want on it. Pay yourself rather than some landlord. It is always tempting to go big before you are ready. But you need a reserve of funds in order to avoid going bust. And don't think someone else can't do what you are doing - because they can very easily.

**Libertytow** · 09-19-2016, 04:36 PM

Before I throw.my 2 cents here I am going.to ask.you to read.my post here
http://www.scrapmetalforum.com/more-than-scrap-value/11476-selling-washers-dryers-more-$$$$$$.html I had the big shop sort space and made an caseload of.money doing.It

Until I didn't rest assured that huge investment can.swallow you whole.And.bankrupt you my cell number is in my signature.if.you.need.advice but I caution you

**RLS0812** · 09-19-2016, 07:13 PM

Originally Posted by StRegis

I wouldn't even rent a storage unit on a monthly basis. And why are you giving away $300 worth of scrap each month? You can't put that in a pickup truck to your local scrap yard for cash? With that scrap money saved over two years you will have enough for a down payment on an acre of land and you can dump whatever scrap you want on it. Pay yourself rather than some landlord.

This guy lives in California. Environmental regulations and all that BS prevent anyone from "dumping" anything on privet property without paying massive fines.
I can actually see why he "gives away" some scrap, as the cost is very high to legally dispose of in that state.

**aph** · 09-21-2016, 03:43 PM

Originally Posted by StRegis

And why are you giving away $300 worth of scrap each month? You can't put that in a pickup truck to your local scrap yard for cash?

We could only do pickup loads with a decent size trailer at a time. The only yeard that pays decent is SIMS and their processes are so ridiculous that it takes between 45-60 minutes per trip, even though they are 5 min from our warehouse. With what little they pay we would make maybe $30-40 per trip. I make more money per hour doing other things. Due to the space restraints we can't recover the non-ferrous right now either. In the big picture it is more profitable to give it away right now. We are in ghetto ass part of town and we can not leave anything outside at all or it walks away.
With the bigger place we could process much more efficient and make sure we get the biggest ehaviest loads possible everytime we go. Another option we will consider is get big roll off containers if the $$ adds up, time saved vs what the containers will cost us in extra fees.